China’s Recovery and Global Growth
CAMBRIDGE – China is likely to be the first of the major economies to recover from the current global downturn. Its pace of expansion may not reach the double-digit rates of recent years, but China in 2010 will probably grow more rapidly than any country in Europe or in the western hemisphere.
But, even as China recovers from its current slowdown, it is not likely to provide a similar boost to all of its trading partners. That lack of spillover will reflect the recovery’s focus on expansion of domestic demand.
There is no doubt that China currently is suffering from the global collapse in demand for a wide range of manufactured products. The sharp drop in retail sales in the United States and Europe means fewer orders for the goods produced in Chinese factories.